Mumbai: Corporate India’s expectation about an improvement in new orders and sales growth have turned highly optimistic for the current quarter as they believe that a slew of project clearances undertaken by the government in recent months and the possibility of a stable government at the centre post the Lok Sabha elections would help in reviving the sluggish domestic demand.
According to a survey done by Dun & Bradstreet, business optimism regarding volume of sales stands at a 13 quarter high while optimism about new orders stands at a 12 quarter high.
“Even as business sentiment continues to be impacted by economic uncertainty, a sense of confidence appears to be slowly returning. The buoyant sentiment regarding future demand conditions, reflected in the 13-quarter high optimism for volume of sales, underscores the confidence apparent in the domestic economy currently. The clearances awarded to projects under implementation by the Cabinet Committee on Investments and a pickup in new project announcements could have played a role herein.” said Kaushal Sampat, president and CEO, Dun & Bradstreet, India.
The Dun & Bradstreet Composite Business Optimism Index stood at 154.5 for Q2 2014, an increase of 9.1 per cent as compared to Q2 2013. The survey noted that around 83 per cent of the respondent expects the volume of sales to increase in Q2, 2014 while 68 per cent of the respondents expect an increase in profits during the same period.
Among the respondents, 81 per cent expect their order book positions to improve and 58 per cent expect their level of stocks to improve during the period.
However, the increased business optimism is not expected to significantly improve employment opportunities in the immediate future as only 39 per cent of the respondents intend to increase the number of employees while 55 per cent of the survey participants anticipate no change in the size of their workforce employed during Q2 2014.
Among the sectors, the services sector was the most optimistic regarding increasing the workforce while the consumer non-durables sector was less optimistic about this issue.
